Antitrust: The Institute recommends inclusion of a specific legal mechanism to enable Government and industry to work together, similar to that established under the Defense Production Act of 1950. This act authorizes the President to consult with representatives of industry, labor, agriculture, and other affected interests to develop voluntary agreements and programs to allocate materials and facilities in such a manner, and upon such conditions, as he shall deem necessary or appropriate. The Institute will be glad to suggest specific language, if desired.

Reduction schedule for lead in leaded gasoline: The Environmental Protection Agency has proposed, but not yet promulgated a leadreduction schedule.

Reducing the lead in leaded grades of gasoline, however, would result in increasing the Nation's consumption of crude oil. In view of this country's already serious energy supply shortage, the Institute urges that the proposed lead reduction schedule be held in abeyance.

One final point: This legislation concerns itself with short-range steps which the Nation should take to cope with the immediate problem occasioned by the cutback in available imports. The API supports these efforts fully.

We would like to emphasize, however, that the basic problem of energy supplies facing the Nation is more pervasive than that involved in this emergency situation. It will face us even if, as we all hope, the present crisis is relieved in a relatively short time. We therefore hope that the Congress will promptly address itself to additional legislation-including the deregulation of natural gas, which could have a positive effect during the emergency if it persists and certainly would over the long haul-necessary to increase the Nation's domestic supply of energy resources.

Again, on behalf of the Institute I want to thank the committee for the opportunity to appear here today. I will be glad to try to answer any questions you may have.

Senator FANNIN. Thank you very much. I appreciate your testimony. If you have antitrust suggestions, that is, suggestions for changing the antitrust provision, in S. 2589, we would appreciate receiving it.

I thank you for these other suggestions and recommendations, and as I say, if there are any other suggestions that either you have Mr. Gammelgard or you Mr. Crawford, we would appreciate it by the morning. It is a return arrangement, but I very much appreciate your appearing here today and for staying here to 7 o'clock at night, and I commend both of you for the statements, we know there is something needed if we are going to have a successful program. We realize it was brought up hastily and there is a long-term problem that needs to be solved.

We realize we are going to have legislation to cover that although I can't promise we will have legislation of that type in this particular legislation.

Senator McClure.

Senator MCCLURE. Thank you, Mr. Chairman. I appreciate the fact that you gentlemen upon relatively short notice, did prepare testimony and have spent the day down here.

I want to apologize to you for having created this situation in which you find yourselves. The fact that we have shared the day, perhaps indicates our own commitment.

I would also like to apologize to the next witnesses, because unfortunately, I am going to have to leave right away. I want to just concentrate for a moment on three or four facts.

I am sorry that Mr. Kenna had to leave, because the National Association of Manufacturers has an Illinois manufacturers association that have already undertaken to make a survey of industry within Illinois, as far as the FRI study he made reference to. And the IMA has already surveyed in Illinois, not only the utility, but factories that have operative coal-burning facilities and they report that these industries, if permitted, reactivation by taking back the clean air standards, save 3 billion cubic feet of natural gas per year.

I want to just go to a couple of things in your statement, Mr. Gammelgard.

On the first page of your statement, you say, S. 2589 would grant the President sweeping powers which in ordinary times we would not support. I would add amen to that.

Then you go on to say, these are extraordinary times and they call for extraordinary remedies, and I certainly agree with that.

Then, at the bottom of the page you say 10-percent reduction within 10 days and 25-percent reduction within 4 weeks of the interruption of normal supply, would have a drastic impact upon the economy of the Nation and, indeed, on the whole way of life of the American people, massive unemployment could occur and essential businesses could be sharply curtailed. Unless something happens to open the supply of petroleum products to this country, directly and indirectly from the Arab world we will have that kind of interruption, isnt' that correct?

Mr. GAMMELGARD. I fully believe that, Senator.

Senator MCCLURE. So what you think here, as being a very drastic possibility, Mr. Gammelgard, becomes almost grim reality? Mr. GAMMELGARD. Yes.

Senator MCCLURE. And the Defense Department prediction that we will begin to feel that by December 15 is almost upon us. We sat here following the President's energy crisis, basking in the warmth of the TV lights, 2 weeks from now we might not have enough energy to have this kind of hearing with this lighting and people think we are pushing the panic button and somehow we have overstated the case and if we don't get additional supply from some source within 2 weeks, we are going to begin to see the curtailment of activities in the way which you have described in your statement.

Mr. GAMMELGARD. I subscribe to that fully, and it is a rather frightening outlook for this country, I think if we can get the public in on it, and outline the dimensions of this problem and call on them to do whatever they can, and if each of us took 20 percent of our driving miles and cut out the pressure, this would have a marked impact and lessen the demand on gasoline immediately.

Buses are a partial solution, but carpooling is something right here and right now, if you can get the public to do it.

One point two people per car would be easy to double that. Senator MCCLURE. I suggested in April, perhaps we open the buslanes from Shirley to cars and get some real impetus into carpooling activity. I think we can look at our parking around the Capitol and say any person that drives in one person can't park there that day.

This doesn't require action for all of the rest of the people in the country, this is our problem.

Mr. Crawford, I am disturbed by one of the statements you made. I am afraid it is accurate, that is why it disturbs me.

At the top of page 3, you refer to a utility in New York, Con Edison, seeking to convert from oil to coal and on top of page 3 you say the company has estimated that it will take as long as 2 months to obtain sufficient coal for the units, and that the conversion process will take approximately the same length of time. Do we have 2 months?

Mr. CRAWFORD. If we have it or not, that is the time it will take us to make necessary conversion.

Senator MCCLURE. Con Ed is now burning jet fuel in turbines, which is the least efficient way to burn fuel, isn't it?

Mr. CRAWFORD. Yes.

Senator MCCLURE. We have seen a World Trade Center in New York, and that one center consumes enough energy to completely furnish a city of 100,000 people.

Mr. CRAWFORD. Also to these, Senator, these peaking units had to be established because the Cornwall project was not established.

Senator MCCLURE. Con Ed has to call upon their neighbors to provide power to help them over the rough spots and consumers in other areas are being asked to subsidize New York power.

Mr. CRAWFORD. That is the net inflow to New York City. There are contracts that provide the costs on each of these transactions.

Senator MCCLURE. And those contracts are lower than the net revenue generated in alternative sales by utilities provided to Con Ed? Mr. CRAWFORD. I believe so.

Senator MCCLURE. That appears to me to be a subsidy to people in New York by the people who supply the power, which seems to me to be one of the problems we have confronting us.

We haven't really looked down the road far enough to see what we can do. We are not really here to do that tonight. Thank you very much.

Mr. CRAWFORD. Thank you.

Senator HANSEN [presiding]. Mr. Gammelgard and Mr. Crawford, let me say how much we appreciate your appearance here today. I think your testimony is very helpful.

I talked with each of you on specific problems. And I have been looking through your testimony, Mr. Crawford. I can't quite find the precise quotation I thought I heard you utter, and that was something to the effect that if the electric utility industry could be given economic incentives rather than to be mandated to convert to coal, that there could be quicker compliance?

Mr. CRAWFORD. That is not actually in my written statement, Senator. I didn't mean to infer to economic incentives. I say rather than forcing the utilities to convert to coal. It seems to me it is better to provide an incentive to encourage the country to convert to coal and that incentive, indeed, is not what cost you economically. It is to open up a source of fuel which is coal.

Senator HANSEN. What you are saying is that you believe that the industry deserves and, indeed, must have reasonable assurances that, being willing to undertake the expensive job of converting from the burning of one fuel to another, going from oil or natural gas to coal, that there must go with that action and assurance that the stockholder, the investor, will be able to recover the investment that will be required to make that switchover. Is that what you are saying.

Mr. CRAWFORD. We have to be sure we can continue to burn the fuel once we convert to use it, and the suppliers have to be assured that we will take it for an extended period of time, or else they won't give it to us at all.

Senator HANSEN. There have been all sorts of suggestions, Mr. Crawford, as to the way the waste of energy can be discouraged. Among some of these has been the suggestion that price could vide such a deterrent.

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Mr. CRAWFORD. We believe that the price of electric power should provide the cost of providing, whatever those costs are, we believe should provide it.

Senator HANSEN. Mr. Gammelgard, I am very much interested in your testimony. I think it compliments in an admirable fashion that testimony given by Mr. Miller earlier this evening when he spoke for the Independent Petroleum Association of America.

The points you make are relevant, I think extremely timely. They spotlight legitimate concerns that this committee ought to have before it as it undertakes the very difficult and, indeed, dangerous responsibility of trying to write legislation that is as far reaching and can impact on America to the degree which I believe this bill has.

You referred to the Santa Barbara Channel. It must take some courage for someone in the oil business to even mention Santa Barbara, is that true?

Mr. GAMMELGARD. I guess so. I was out there several times since this bill to see how well this area has recovered. I think the company that was operating it, did a tremendous job of cleaning it up, and got very little credit for it.

Be that as it may, the area is in good shape and has been for some time, and there were several studies sponsored by the west coast petroleum group there.

So, I don't think there was any lasting disaster by any means. It was a very unfortunate incident in a very beautiful area like that, no question about it.

Senator HANSEN. There have been some university responsive research studies that indicate there was no permanent ecological damage from that spill. I happened to be on hand when the late Dr. Pecora testified to this committee in executive session a few years ago.

As he explained the complex geology to us, he pointed out the coal oil point and some other points in this general area have been spewing oil into the ocean long before man ever sunk a drill into it. He suggested steps that may be taken, not at that time to increase our available supply of petroleum, but rather to obviate that spillage as quickly as possible. I got some pretty good reason that that Santa Barbara Channel oil sediment should be pumped and produced, having in mind minimizing the chances of further spills out there.

Mr. GAMMELGARD. I would agree with you. As I recall, there was a panel, Mr. Chairman, I forget whose it was, but it was put together to study what could be in that situation. They made the recommendation pretty much along the language you used.

Senator HANSEN. Let me say we appreciate your testimony here. It will be read and considered by the committee and by the staff. I appreciate it very much. Thank you.

Mr. GAMMELGARD. Thank you, Mr. Chairman.

The CHAIRMAN [Senator Jackson presiding]. Thank you, Senator Hansen, I regret I had to step out for awhile, and I appreciate you and your colleague Senator Fannin for having chaired the committee in my absence.

I don't have any further questions.

Senator HANSEN. Mr. Chairman, I am sure you know what the situation is. Obviously the three gentlemen on the left are yet to be heard from. Mr. Ayers, Mr. Hawkins, and Mr. Moss.

STATEMENT OF LAWRENCE MOSS, PRESIDENT, SIERRA CLUB, ACCOMPANIED BY RICHARD AYERS AND DAVID HAWKINS

Mr. Moss. My name is Lawrence Moss, I'm here to represent the Sierra Club, of which organization I'm president, Friends of the Earth and the National Resources Events Counsel. I'm accompanied by Richard Ayers and David Hawkins of the National Resources Defense Counsel, they have been actively involved in the 3 years over questions of enforcing the Clean Air Act. We are appreciative to appear before the committee and give our thoughts on this matter.

I wish to first present a general statement and then call on Mr. Ayers to comment on public health, and Mr. Hawkins, to give our specific recommendations concerning the language of S. 2589. We recognize this is an emergency situation, all of us are ready to do our share, but it's important that a balanced approach be taken. We don't believe that the President is doing so. He says he needs the necessary authority to relay environmental regulation on a case by case basis, those permit a proper balancing of our environmental interests.

What kind of balancing takes place when you compare an interest with an indefensible requirement? And is it really an indefensible requirement for each of us to use 50 percent of the amount of energy than most other people in the world? Why would it make it 30 times or 40 times? Too much reliance, at least for now, is put on voluntary conservation. The lack of mandatory actions to conserve energy contrasts with the specific action proposed to increase supply, even at the expense of environmental quality, and we will need to conserve energy immediately in view of Mr. McGee's comments concerning the difficulties of expanding coal supply.

In the support range, about the only way we can bring supply and demand for energy into balance is to use less. Perhaps the most effective way of doing this immediately is through a tax on the use of energy, a small amount for each person.

The President suggested some aspect of this for something to be planned for in his statement, but he didn't call for it right away. Further, we need safeguards to assure that any relaxation of environmental laws, are temporary. These are not provided for in the President's proposal. Actions which result in violation of environmental laws, should be made as a last resort. They should be contingent upon certain criteria and steps previously taken.